Foundations and Funders

Definition
According to the Foundation Center, A foundation is an entity that is established as a nonprofit corporation or a charitable trust, with a principal purpose of making grants to unrelated organizations or institutions or to individuals for scientific, educational, cultural, religious, or other charitable purposes. This broad definition encompasses two foundation types: private foundations and public foundations. The most common distinguishing characteristic of a private foundation is that most of its funds come from one source, whether an individual, a family, or a corporation. A public foundation, in contrast, normally receives its assets from multiple sources, which may include private foundations, individuals, government agencies, and fees for service. Moreover, a public foundation must continue to seek money from diverse sources in order to retain its public status.

The best way to identify private foundations is to refer to the formal determination made by the Internal Revenue Service. Under the rules first set forth by the Tax Reform Act of 1969, those nonprofits determined by the IRS to be "private foundations" are treated differently from other nonprofits. To understand the differences between private and public foundations, it is helpful to trace the path that leads to an IRS determination letter. A nonprofit that has been legally established in one of the 50 states must obtain recognition as a charitable organization from the IRS in order for contributions to it to be tax deductible. Section 501 of the Internal Revenue Code covers many types of organizations that are exempt from federal income tax. It covers those tax-exempt organizations that are "organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes...."

An organization that meets the definition of Section 501 (c) (3) is measured against Section 509(a) of the Internal Revenue Code, which declares that a 501(c)(3) organization is presumed to be a private foundation unless it can demonstrate that it meets at least one of the four criteria:

It is an organization described in 170(b)(1)A: churches, schools, colleges, etc.; hospitals, medical research institutes, etc.; support organizations to public colleges or universities; certain governmental units; publicly supported organizations;

It is an organization that normally receives more than one-third of its support from gifts, grants, or fees and gross receipts from admissions, sales, etc. and normally receives not more than one-third of its support from investment income;

It is a supporting organization that is not publicly supported but is organized for and controlled by another public charity;

It is an organization organized and operated exclusively for testing for public safety. Most grantmaking foundations apply for Section 501(c)(3) status. Those that do not meet the requirements for classification as "not a private foundation" are, by default, private foundations. Thus the IRS defines a private foundation by exclusion: a private foundation is a nonprofit organization that does not meet one of the four criteria for exclusion. The IRS does not have a separate classification for "public foundations," so public charities that are significant grantmakers can be difficult to identify using IRS definitions and resources.

The tax laws for private foundations include, among other things, a minimum distribution requirement, an excise tax on investment income, and a limit as to the proportion of a for-profit enterprise they may own, the "excess business holdings" rule. Private foundations must make "qualifying distributions" of at least 5 percent of the average market value of their investment assets in any given fiscal year by the end of the following year, a rule often referred to as "the payout requirement." The excise tax, normally 2 percent of net investment income, or 1 percent in special circumstances, counts as a credit toward the 5 percent minimum.

Although they are complex, the definitions of foundations contained in the Internal Revenue Code determine not only the way a foundation must operate but also the information it must make publicly available. All private foundations must file the Form 990-PF, which is a valuable source of information about their finances, board members, and grants. The Center acquires the Forms 990-PF from the IRS as they are processed and adds them on a continuous basis to a database identifying virtually all private foundations.

Because the IRS has no separate designation for them, public foundations follow the same reporting guidelines as other public charities. Public charities with gross receipts over $25,000 in any year must file an information return with the IRS for that year, using the Form 990. The Forms 990 for public foundations are indistinguishable from those for non-grantmaking public charities, so they are not a useful means of identifying public foundations.

2004, Top 50 Foundations by Total Giving (in descending order)
rankings are taken from a report by the Foundation Center


 * Bill & Melinda Gates Foundation
 * Ford Foundation
 * Merck Patient Assistance Program
 * Bristol-Myers Squibb Patient Assistance Foundation
 * Lilly Endowment
 * Robert Wood Johnson Foundation
 * David and Lucile Packard Foundation
 * Janssen Ortho Patient Assistance Foundation
 * William and Flora Hewlett Foundation
 * Annenberg Foundation
 * W.K. Kellogg Foundation
 * Gordon and Betty Moore Foundation
 * John D. and Catherine T. MacArthur Foundation
 * Andrew W. Mellon Foundation
 * Roche Patient Assistance Foundation
 * Annie E. Casey Foundation
 * Starr Foundation
 * Wal-Mart Foundation
 * California Endowment
 * Lilly Cares Foundation
 * Rockefeller Foundation
 * New York Community Trust
 * Charles Stewart Mott Foundation
 * Aventis Pharmaceuticals Health Care Foundation
 * Peninsula Community Foundation
 * Duke Endowment
 * Robert W. Woodruff Foundation
 * Walton Family Foundation
 * Harry and Jeanette Weinberg Foundation
 * Kresge Foundation
 * Donald W. Reynolds Foundation
 * Boehringer Ingelheim Cares Foundation
 * California Community Foundation
 * John S. and James L. Knight Foundation
 * McKnight Foundation
 * Carnegie Corporation of New York
 * Open Society Institute
 * Community Foundation for the National Capital Region
 * Foundation for the Carolinas
 * Ford Motor Company Fund
 * Richard King Mellon Foundation
 * Community Foundation Silicone valley
 * Houston Endowment
 * Citigroup Foundation
 * Freeman Foundation
 * Wells Fargo Foundation
 * Boston Foundation
 * Whitaker Foundation
 * Greater Kansas City Community Foundation
 * Cleveland Foundation

2004, Top 50 Foundations by Total Assets (in descending order)
rankings are taken from a report by the Foundation Center
 * Bill & Melinda Gates Foundation
 * Ford Foundation
 * J. Paul Getty Trust
 * Robert Wood Johnson Foundation
 * Lilly Endowment
 * W.K. Kellogg Foundation
 * William and Flora Hewlett Foundation
 * David and Lucile Packard Foundation
 * Andew W. Mellon Foundation
 * Gordon and Betty Moore Foundation
 * John D. and Catherine T. MacArthur Foundation
 * California Endowment
 * Starr Foundation
 * Annie E. Casey Foundation
 * Rockefeller Foundation
 * Kresge Foundation
 * Annenberg Foundation
 * Duke Endowment
 * Charles Stewart Mott Foundation
 * Casey Family Programs
 * McKnight Foundation
 * Robert W. Woodruff Foundation
 * Harry and Jeanette Weinberg Foundation
 * Carnegie Corporation of New York
 * John S. and James L. Knight Foundation
 * Ewing Marion Kauffman Foundation
 * New York Community Trust
 * Richard King mellon Foundation
 * Doris Duke Charitable Foundation
 * Cleveland Foundation
 * James Irvine Foundation
 * Alfred P. Sloan Foundation
 * Houston Endowment
 * Wallace Foundation
 * Chicago Community Trust
 * Brown Foundation
 * W.M. Keck Foundation
 * Donald W. Reynolds Foundation
 * Lumina Foundation for Education
 * William Penn Foundation
 * Michael and Susan Dell Foundation
 * Kimbell Art Foundation
 * Samuel Roberts Noble Foundation
 * Walton Family Foundation
 * Freeman Foundation
 * California Wellness Foundation
 * Marin Community Foundation
 * Moody Foundation
 * Daniels Fund
 * Howard Heinz Endowment

General List of Foundations

 * Achelis and Bodman Foundations
 * Adolph Coors Foundation
 * Atlantic Council Foundation
 * Atlas Foundation for Economic Research
 * Bush-Clinton Katrina Fund
 * Carnegie Endowment for International Peace
 * Castle Rock Foundation
 * Charles G. Koch Charitable Foundation; see Koch Family Foundations
 * Charles Stewart Mott Foundation
 * Claude R. Lambe Charitable Foundation; see Koch Family Foundations
 * D & D Foundation
 * David & Lucille Packard Foundation
 * David H. Koch Foundation; see Koch Family Foundations
 * Earhart Foundation
 * Edge Foundation
 * Ford Foundation
 * Henry Salvatori Foundation
 * Independence Foundation
 * JM Foundation
 * Joyce Foundation
 * Koch Family Foundations (David H. Koch Foundation, Charles G. Koch Foundation, Claude R. Lambe Foundation)
 * John M. Olin Foundation, Inc.
 * Lynde and Harry Bradley Foundation
 * MacArthur Foundation
 * Markle Foundation
 * Pew Charitable Trusts
 * Philip M. McKenna Foundation, Inc.
 * Phillips Foundation
 * Ploughshares Fund
 * Potomac Foundation
 * Randolph Foundation
 * Robertson Foundation
 * Rockefeller Foundation
 * Rockefeller Brothers Foundation/Rockefeller Brothers Fund
 * Rodney Fund
 * Ruth and Lovett Peters Foundation
 * Scaife Foundations (Scaife Family, Sarah Mellon Scaife, Carthage, Alleghany)
 * Smith Richardson Foundation
 * Swig Foundation
 * Thomas B. Fordham Foundation
 * Tides Foundation & Tides Center
 * William H. Donner Foundation

Related SourceWatch Resources

 * Foundation support for nonprofit organizations
 * Funders/terminology
 * fundraising companies
 * Liberal Foundations and the Environmental Movement
 * pro-Israel lobby
 * Think tanks
 * Tax-exempt foundations

General Information

 * Guidestar provides the required 990 forms for most non-profit organizations and foundations in the U.S.
 * Harold Laski, "Foundations, universities, and research," In: Dangers of Obedience and Other Essays (New York, Harper & Brothers, 1930), p.174.
 * Edward Berman, The Ideology of Philanthropy: The Influence of the Carnegie, Ford, and Rockefeller Foundations on American Foreign Policy, (SUNY Press, 1983)
 * The Center for Consumer Freedom is a funder/foundation watchdog organization. Also see Info Files for Activists, Foundations, Celebrities, and Key Players.
 * Media Transparency: a funder/foundation watchdog organization.
 * Jill Junnola, Perspective: Who funds whom?, CampusWatch.org from Energy Compass, October 4, 2002.
 * Integrity in Science Database of Scientists' and Non-Profits' Ties to Industry: The Center for Science in the Public Interest.
 * Joan Roelofs, "The Invisible Hand of Corporate Capitalism", Recorded at Hampshire College, April 18, 2007. (Audio File)
 * Joan Roelofs, "The Third Sector as a Protective Layer for Capitalism", Monthly Review,. 47(4), pp.16-25., 1995.

Articles & Commentary

 * Richard W. Behan, "The Free-Market Al-Qaeda: Neoliberal Think Tanks and the Harm They Do," Baltimore Chronicle, June 4, 2003. (This article reviews the success of a dozen right-wing foundations in reshaping US public policy debate.)
 * Thomas A. Troyer and Robert A. Boisture, "What the Law Allows: An overview of the laws that govern what private foundations can and can't do regarding involvement in the public policy process, ''Foundation News & Commentary, Volume 38, No. 3, May/June 1997.
 * Jordan Flaherty, "Foundations, Nonprofits and the Second Looting of New Orleans: A Catastrophic Failure", Counterpunch, December 16 / 17, 2006.
 * Michael Barker, "The Liberal Foundations of Media Reform? Creating Sustainable Funding Opportunities for Radical Media Reform", Global Media Journal, June 2008. (Evolution of the means to manufacture consent.)
 * Michael Barker, "The Liberal Foundations of Environmentalism: Revisiting the Rockefeller-Ford Connection", Capitalism Nature Socialism, 19 (2), pp. 15-42. (For full paper email author)
 * Joan Roelofs, "The Philanthropies and the Economic Crisis: Where Were the Foundations?", Counterpunch, May 28, 2009.